Love & Loans: The Effect of Beauty and Personal Characteristics in Credit Markets

66 Pages Posted: 6 Mar 2008 Last revised: 7 Mar 2019

See all articles by Enrichetta Ravina

Enrichetta Ravina

Federal Reserve Bank of Chicago; Center for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Multiple version iconThere are 2 versions of this paper

Date Written: February 15, 2019


I find that beauty, race, age, and personal characteristics affect lenders decisions, once credit and employment history, homeownership, and other hard financial information are accounted for. Beautiful borrowers are 11.7% more likely to get a loan, pay similar interest rates as average looking borrower with the same credentials, but default more often. Black borrowers are significantly less likely to get a loan (-16.9%), pay similar rates as White borrowers, and they are more likely to default. These findings are consistent with taste-based discrimination of the unattractive, and statistical discrimination of black borrowers. However, minority borrowers with more lenders from areas of high racial prejudice face lower probability of getting funds and higher interest rates. More nuanced models of lender specialization could also explain the results.

Keywords: Beauty, Credit Markets, Discrimination

JEL Classification: G20, D10, J71

Suggested Citation

Ravina, Enrichetta, Love & Loans: The Effect of Beauty and Personal Characteristics in Credit Markets (February 15, 2019). Available at SSRN: or

Enrichetta Ravina (Contact Author)

Federal Reserve Bank of Chicago ( email )

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Center for Economic Policy Research (CEPR) ( email )

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European Corporate Governance Institute (ECGI) ( email )

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